IVA and other family members

[ray_a]

I have come accross a potential postion where a family are in very serious financial trouble. Presently their daughter is working to maintain her parents. Her father is seriously handicapped and her mother spends most of her time looking after them.

They own a home and have some equity.

Question for the experts please?

If I was to advise for them to consider an IVA could the daughter make the IVA payments for her parents so as to protect the family home. If so what work would I be required to satisfy a potential supervisor that this can work. I expect i will have to do a fair bit of spade work on this?

Many thanks

Ray

[kallis3]

Hi Ray,

Can't answer your question unfortunately, but I'll bump this back up so hopefully an expert will see it.

[Soulgrowth]

Hi Ray

I would have thought that they would have to satisfy their IP, and creditors, that they had the income to afford an IVA. In this case I would think that the daughter would have to somehow 'officially' pay into the household income in some way.

Debbie

[size5]

IVA's can indeed be "3rd party funded"

One example of that is where a family member is willing to fund a full and final settlement of the IVA by providing the funds to do so, but I have also seen IVA's funded on a contributions basis by family members.

Best to take professional advice directly on the scenario in question, I would also add that in this case, whilst appreciating greatly your concern for your friends, I would wish to speak to the individuals involved, and the daughter, in some depth before I made any recommendation at all, whatever that may turn out to be.

Hope this helps.

Regards.

[MelanieGiles]

I have a number of cases which are operating on this basis Ray - the key think is for you to ensure that the daughter's covenant is a good sound basis for a five year repayment. There are several ways to skin a cat, and you might want to have a chat with an IP directly to run through the scenario in greater detail.

[ray_a]

Many thanks it is at early stages just looking at all the options available!

[geoffhibbert1]

It seems a bit of a risk for the daughter to be involved in a plan that will last for 5 years. You dont mention if the daughter is married or has her own family, if not she may do one day and possibly before the 5 years is over. This could cause the IVA to fail and leave the parents facing bankruptcy. An alternative to look at is a Debt Management Plan which to give a one sentance summary is a less formal somewaht more flexible approach, which may suit this circumstance.